SPLASH BEVERAGE GROUP, INC. Leases Disclosure
Note 9 – Lease
The Company has various operating lease agreements primarily related to real estate and office space. The Company’s real estate leases represent a majority of the lease liability. Lease payments are mainly fixed. Any variable lease payments, including utilities, and common area maintenance are expensed during the period incurred. Variable lease costs were immaterial for the year ended December 31, 2025 and 2024. A majority of the real estate leases include options to extend the lease. Management reviews all options to extend at the inception of the lease and account for these options when they are reasonably certain of being exercised.
Operating lease expense is recognized on a straight-line basis over the lease term and is included in operating expense on the Company’s condensed consolidated statement of operations and comprehensive loss. Operating lease cost was $322,020 and $360,409 during the twelve-month period ended December 31, 2025 and 2024, respectively.
The following table sets for the maturities of our operating lease liabilities and reconciles the respective undiscounted payments to the operating lease liabilities in the consolidated balance sheet at December 31, 2024.
| Undiscounted Future Minimum Lease Payments | Operating Lease | |||
| 2026 | 52,703 | |||
| 2027 | 2,976 | |||
| Total | 55,679 | |||
| Amount representing imputed interest | (1,983 | ) | ||
| Total operating lease liability | 53,696 | |||
| Current portion of operating lease liability | (50,720 | ) | ||
| Operating lease liability, non-current | $ | 2,976 | ||
The table below presents information for lease costs related to our operating leases at December 31, 2025:
| Operating lease cost: | ||||
| Amortization of leased assets | $ | 308,968 | ||
| Interest of lease liabilities | 13,052 | |||
| Total operating lease cost | $ | 322,020 |
The table below presents lease- related terms and discount rates at December 31, 2025:
| Remaining term on leases | 10.75 months | |||
| Incremental borrowing rate | 4.17 | % | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Apr 15, 2026 | Showing above |
| 2024 | Jul 11, 2025 | |
| 2023 | Mar 29, 2024 | |
| 2022 | Mar 31, 2023 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.